Cash Flow Calculator

Cash flow is net income restated as cash, which means adding back non-cash charges and adjusting for working capital.

Net incomeBottom line after tax, from the income statement.Depreciation and amortisationNon-cash charges to add back.Increase in receivablesHow much more customers owe at period end than at period start.Increase in payablesHow much more the business owes suppliers at period end than at period start.Capital expenditureCash spent on equipment and long lived assets, deducted for free cash flow.

Operating cash flow

$280,000.00

Free cash flow: $190,000.00
Cash conversion: 116.67%

Values update as you type. This calculator covers the single scenario its formula assumes — see Common Mistakes for what it leaves out.

The formula this calculator uses

operating cash flow = net income + depreciation - increase in receivables + increase in payables

OCF: Operating cash flow, cash generated by trading
NI: Net income after all expenses
D: Depreciation and amortisation, non-cash charges added back
AR: Increase in receivables, sales not yet collected
AP: Increase in payables, costs not yet paid

How to check the result by hand

1
Take net income from the income statement
The bottom line after tax. Use the same period as every other figure in the calculation, since mixing periods is the most common source of a wrong result.
2
Add back depreciation and amortisation
These charges reduced net income without any cash leaving, so they are added back in full. Sixty thousand of depreciation is sixty thousand of cash added back.
3
Subtract the increase in receivables
A thirty five thousand increase means thirty five thousand of revenue has not been collected. That revenue is in net income but not in the bank, so it is subtracted.
4
Add the increase in payables
A fifteen thousand increase means fifteen thousand of costs have not been paid. Those costs are in net income but no cash left, so it is added back.
5
Subtract capital expenditure for free cash flow
Depreciation is added back because it is not cash, but replacing equipment is cash. Ninety thousand of capital expenditure leaves one hundred and ninety thousand of free cash flow.

For worked examples, common mistakes and the limits of this formula, read the full How To Calculate Cash Flow page.